Decisions a DoA should cover
- Purchase requisitions and purchase orders.
- Vendor payment release and bank signatories.
- Capital expenditure.
- Sales discounts, credit limits and credit notes.
- Write-offs of receivables and inventory.
- Hiring, salary changes and bonuses.
- Contracts and legal commitments.
- Journal entries above a threshold.
Structure
Set limits A and B to suit the size of your business; the right figures differ from company to company.
| Decision | Initiator | Level 1 limit | Level 2 limit | Level 3 |
|---|---|---|---|---|
| Purchase order | Requester | Dept head up to limit A | Finance head up to limit B | CEO above limit B |
| Payment release | Accounts | Finance manager up to limit A | Finance head up to limit B | Two signatories above |
| Credit note | Sales | Sales head up to limit A | Finance head | CEO |
Rules
- Limits apply per transaction; splitting to stay under a limit is prohibited.
- No one approves their own request.
- Absent approvers delegate in writing, for a set period.
- Review annually and after organisation changes.
We design DoAs and configure them in Zoho. See RACI and delegation of authority.
Frequently asked questions
Who approves the delegation of authority matrix?
The board of directors, or the managing director where the board has delegated that power.
How do we set the approval limits?
Start from transaction volumes: limits should let most routine transactions be approved at the level that knows them best, while large or unusual ones reach senior management. Review the distribution after three months and adjust.
Should the DoA be in the ERP?
Yes. When approval rules in the system mirror the DoA, the policy is enforced every time and the audit trail shows who approved what.
General information only, not legal, tax or software licensing advice. Zoho features, editions and prices change, so confirm the current position with Zoho or with our team before you commit. See our disclaimer.
